Matthew Taylor’s Review of Modern Working Practices has been cautiously welcomed by the Federation of Small Businesses (FSB).

FSB welcomes the Taylor Review’s recommendations to crack down on false self-employment through the creation of a new ‘dependent contractor’ status, which is clearly distinct from the genuinely self-employed. But FSB warns that Ministers must not be allowed to widen the net on a whim.

FSB supports the principle that the Government should recognise the wide variety of forms of modern self-employment and should act to support and protect those who need help.

It also welcomes the call for the Government to focus on encouraging self-employed people to plan for the future, reducing the potential that the taxpayer has to pick up additional costs associated with ill health or inadequate retirement saving.

UK small businesses already provide good quality jobs within their local communities and must not be hindered from this with disproportionate reporting requirements and bureaucracy.

FSB National Chairman Mike Cherry, said: “We welcome having a set of proposals on the table which attempt to strike a balance between a fairness and a flexible labour market. The new ‘dependent contractor’ status, if done right, should bring protections to those unfairly treated in the gig economy, whilst also protecting the genuinely self–employed.

“It’s positive that the Review promotes self-employment as a careers choice. It’s right skills, productivity, savings and the cost of employment are highlighted as key issues for the Government to address. Collective action and collaboration can play an important role in this.

“However, the tax system must continue to recognise the risk and insecurity faced daily by the genuinely self-employed – this is right in principle. Ministers must make no attempt to single out them out for tax hikes.

“Government and Parliament must now protect the genuinely self-employed from being dragged into a new category of dependent contractors. Legislation must not be so broadly drafted as to give Ministers the power to widen the net on a whim without robust Parliamentary oversight, in a way that hurts the genuinely self-employed.”

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